Stabilise retirement provision and make it sustainable

Retirement provision is facing major challenges: Life expectancy is increasing and people are having fewer children. Rising life expectancy means that pensions from state old-age and survivors’ insurance (OASI, first pillar) and occupational pensions (OPA, second pillar) are being paid out for ever longer periods. In addition, with OASI, the number of contributors per pension recipient is constantly decreasing due to baby boomers retiring and the birth rate falling, resulting in growing deficits without any countermeasures in place. And under the mandatory OPA insurance scheme, there is an enormous redistribution of funds outside the system from working people to pension recipients because the OPA conversion rate is much too high and interest rates have fallen (and are likely to remain low for the time being).

In a referendum on 3 March 2024, the popular initiative for a 13th OASI pension was accepted. When introduced, the costs of the 13th OASI pension will amount to CHF 4.1 billion. They will rise to around CHF 5 billion per year within five years. Financing was left open in the popular initiative and remains the subject of parliamentary deliberation (status as of March 2026). 

On 26 November 2025, the Federal Council set out the guidelines for the OASI 2030 reform. In order to secure OASI financing for the period from 2030 to 2040, it plans to increase income from current sources of financing (i.e. wage contributions and VAT). However it does not intend to introduce new sources of financing, such as a financial transaction tax, an inheritance tax or a property gains tax. To promote continued employment after the OASI reference age has been reached, the OASI maximum age of 70 is to be abolished, the deductible amount increased and early retirement made less attractive. However, a higher reference retirement age is not an option for the Federal Council as part of the OASI 2030 reform. Its stated rationale for this is that in 2024, the electorate clearly opposed an increase in the reference age in the referendum on the popular initiative for safe and sustainable retirement provision, which provided for linking retirement age to life expectancy. The Federal Council also argues that a general increase in the reference age would require a long transition period and compensation measures, which is why the increase would not have an impact on OASI finances early enough to ensure the financing of OASI from 2030.

The SIA considers an increase in the reference retirement age to be unavoidable. Against this backdrop, it is particularly in favour of an intervention mechanism, as proposed by National Councillor Andri Silberschmidt to the National Council in its autumn session of 2025: If the OASI fund falls below 90 per cent, the reference age (plus 0.5 years) is to be raised in addition to VAT (plus 0.5 percentage points).

On 22 September 2024, the Swiss population rejected the occupational pension reform (OPA reform). The aim of the reform was to strengthen the financing of the second pillar by reducing the OPA conversion rate from 6.8 per cent to 6.0 per cent, to maintain the overall level of benefits and to improve protection for part-time employees. A reduction in the OPA conversion rate would have improved the situation of OPA minimum and close-to-minimum pension funds. These pension funds rely on a reduction of the OPA conversion rate in order to be able to curb or avoid pension losses. Alternatively, pension funds that provide benefits above the mandatory level have used the flexibility available to them and taken the necessary measures: 

All-encompassing pension funds have reduced the conversion rate to an average level of around 5.3 per cent.

Pension funds that use the splitting model have modified it by reducing the statutory conversion rate for mandatory retirement assets to, for example, 6.5 or 6.2 per cent and by applying an actuarially correct conversion rate for supplementary retirement assets of approx. 4.5 per cent. 

As part of the OPA reform, provision was also made for an adjustment of the coordination deduction and a reduction of the entry threshold, as well as a flatter staggering of retirement credits (9 / 9 / 14 / 14 per cent instead of 7 / 10 / 15 / 18 per cent). The SIA supported these proposals as part of the overall package, i.e. in conjunction with a reduction in the OPA conversion rate. However, we cannot approve a reduction of the entry threshold and coordination deduction without a reduction in the OPA conversion rate, as this would exacerbate under-funding in the mandatory area.

Beyond financial stabilisation, we should strive to make OASI and OPA sustainable. Long-term sustainable financing of retirement provision requires that the parameters (reference retirement age, OPA conversion rate, OPA minimum interest rate) be set in line with actual conditions and adjusted in line with their development. The SIA supports relevant political initiatives.

Private life insurers manage around 11 per cent of occupational pension assets, insure roughly 42 per cent of actively insured persons (including pure risk insurance) and serve roughly 20 per cent of pension recipients (sources: FSO, Pension Fund Statistics 2024; FINMA, Data on Operating Statements for Occupational Pensions 2024).

Life insurers offer SMEs a comprehensive range of services. They compete actively with each other and with other pension providers. This is reflected, amongst other things, in varying investment returns, risk premiums and surpluses.

The Swiss Solvency Test (SST) has significantly stepped up the requirements for creating and maintaining solvency capital. The excessively high capital requirements mean that guarantees and risk cover become too expensive and can therefore no longer be offered, or only to a limited extent. Those who are exposed to the relevant risks can no longer obtain cover to meet their needs – or the risks have to be borne by the state. This is in direct contradiction to the previous occupational (and private) pension structure, which has been broadly supported in society. Further deterioration of the framework conditions would not be acceptable.